Stunned by 'speed of Shanghai', Tesla's Elon Musk may up the ante in China
June 14 (NBD) -- Electric car upstart Tesla could eventually have more factories in China given the country's market scale, CEO Elon Musk hinted at the annual shareholders meeting in California Tuesday, according to Bloomberg.
In Musk's views, producing cars locally in China could speed up the pace of delivery and increase capital efficiency. "China is pretty big geographically, so it may make sense to have factories in other parts of China in order to reduce logistics costs," he said.
But Musk also noted the further expansion in the country won't come up too soon.
"Musk knows well about China, the market's enormous consumption potentials, and the significance of the auto industry, especially the new-energy vehicle sector, to local governments," Terry Gu, Principal of consulting firm Roland Berger in Greater China, told news outlet Yicai. So it is possible for Tesla to build new plants in other Chinese cities, Gu said.
Tesla is now building its first car plant outside the U.S. in China's Shanghai. The carmaker hopes to put the factory into operation at the end of this year if everything goes all right, a person-in-charge with the carmaker told National Business Daily in late May.
Giving a thumbs-up to the amazingly fast construction speed at Tuesday's meeting, Musk said producing 500,000 vehicles a year at the Shanghai plant is just an "interim" target, and the longer-term goal is to manufacture 1 million vehicles annually, but no timeframe was given.
This May, Tesla completed the takeover of ultracapacitor and battery component manufacturer Maxwell using a share-swap deal.
The acquisition, in many people's eyes, helps Tesla get ahold of new battery technologies, allowing the automaker to guarantee stable battery supply for the Shanghai plant in future expansion while improving battery performance and controlling costs.